by Peter Sondergaard | July 14, 2014 | Comments Off
A successful digital business requires transformational change in the culture, mindset and workforce capabilities. CIOs and business leaders must renew the talent strategy and programs to acquire, nurture and develop requisite workforce core competencies to make the shift.
This is the conclusion and key recommendation of a research note (client access required) published recently by my colleagues Lily Mok, Diane Berry and Janice Francis.
It caught my attention on a flight en route to a conference in Italy because of the sheer magnitude of the advice. I had to read it twice to fully comprehend what it entails: CIOs and business leaders must renew the talent strategy and programs to acquire, nurture and develop requisite workforce core competencies to make the shift (to a successful digital business).
In a word: Whoa! (If you didn’t already know, this is a very technical term for a “massive change!”)
I’ve written on this blog previously that by 2020, more than 7 billion people and businesses, and at least 30 billion devices, will be connected to the Internet. With people, business and things communicating, transacting and even negotiating with one another, a new world comes into being — the world of digital business.
Although technologies will continue to play an essential role in the world of digital business, the authors of this research indicate that business growth objectives will go unmet if CEOs and CIOs ignore the talent and expertise that underpin the success of digital business. The temptation for many in building the digital business will be to focus on technologies first and foremost rather than on people.
Put another way, investing in technology capabilities without investing more in people who understand them, define them and shape them will undermine the efforts of senior leaders to build a digital business.
Lily, Diane and Janice’s research details how CIOs need to quickly address this “people” blind spot by:
Understanding requisite cultural and mindset change, from inside-out to outside-in
- Identifying competencies for making the shift in culture and mindset
- Renewing strategy and practices to acquire and develop people with requisite competencies
This represents a huge undertaking for the CIO and the leadership team, but even more important one that CEOs and CIOs clearly can not overlook. They must focus on:
- Developing the right digital talent and skills across the organization
- Replacing and adding digital talent in areas strategic for a digital enterprise
- And developing digital leadership skills for all business leaders
We’re in the midst of developing our opening keynote for the upcoming Gartner Symposium/ITxpo series and we’d like to include your experience in the theme.
- How are you addressing the culture, mindset and capabilities of your team in the shift to digital business?
- How have you defined the challenge for your leadership team and set objectives to drive change? Or have you simply started the process of defining what digital business means for your organization and experienced how difficult this first step is?
- What barriers have you faced and how have you started to break through them to create the kind of organization you and your organization needs to be successful?
If the transformation inside your organization is not equal to or larger than the transformation of society towards the Digital Industrial Economy, you are falling behind. Transformation is about the right leadership skills. Get your act together now!
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by Peter Sondergaard | May 17, 2014 | 1 Comment
Where should a CEO start with d-business? It sounds sort of obvious, but start at the beginning; define exactly what you mean by d-business.
Not enough CEOs spend time discussing and agreeing on a corporate definition of a new trend to make sure the entire leadership team is on the same page about what it is and why it matters to them. Far too often organizations get lost in endless internal debates where senior leaders use their own—often contradictory—definitions, ultimately distracting their teams from the opportunity that exists if action is taken sooner rather than later. The onslaught of digitalization is certainly one of those trends that require this level of attention, definition and leadership from the CEO; it’s critical that the executive leadership team start by defining the trend for the organization.
We can help you to start the ball rolling.
As d-business is an evolution from e-business, the two will often by compared and confusion will arise from incorrect usage of each. At Gartner we have adopted the usage of the US Census Bureau’s definition of e-business, which is:
Electronic business or e-business is any process that a business organization conducts over a computer-mediated network. Business organizations include any for-profit, governmental, or nonprofit entity. Their processes include production-, customer-, and internal or management-focused business processes
The Gartner definition of d- business is:
Digital business, or d-business, is the creation of new business designs by blurring the digital and the physical worlds due to the convergence of people, business and things.
So what is the main difference? Things!
E-business was the interaction between people and business, specifically business processes using the internet as the integrating technology or network. D-business is the relationship between people business and things. It is about the connection of things to the internet and how those things directly interact with people and business, and indirectly how they create data or information that allows new value to be created.
D-business has a number of specific attributes. They are:
- Nearly all physical and virtual assets in the value chain are digitalized. Intelligent “things” are incorporated into end-to-end processes.
- The business creates and is dynamic and responsive to “business moments,” based on current context.
- Customers and constituents are engaged principally through digital means. Most sales, delivery and service functions are fully automated. Digital generates revenue and/or tangible value for the organization. Most human- or analog-based processes are eliminated.
- Employee engagement occurs principally through digital means. Team collaboration is done virtually, in the moment.
- Operational processes are digitalized. Traditional analog and manual processes are automated, including both physical and human elements. Many decisions are algorithmic, based on automated judgment.
- Things become agents for themselves, for people and for business. The added connectivity, communications and intelligence of things makes many of them agents for services that are currently requested and delivered through people.
Have you led this discussion with your executive leadership team? How did it go? What did you learn? How did your definition change to reflect the perspective of your colleagues across the business? Let us know.
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by Peter Sondergaard | April 29, 2014 | 5 Comments
Every company is becoming a technology company. This is the message I take away each time I meet a CEO or senior business executive to discuss their strategy for growth. It’s the direction that every leading organization, business and government agency is evolving toward. I’m seeing a shift from the old e-business to a new digital business, or d-business, mindset, where leaders no longer simply utilize technology to deliver efficiency and improve functionality, but digitally reimagine every aspect of the enterprise, from product and service creation, to production and delivery.
We decided to dig deeper and look beyond the conversations I’m having with CEOs to determine the broader nature of this trend. Our logic is that if this is indeed true, if organizations are increasingly moving to a d-business mindset, then surely their public statements will talk about digitalization in some way. Their annual reports should contain some degree of detail on initiatives regarding digitalization from a competitive perspective, how business opportunity is being created from digitalized processes and value chains, and how new business models and digitalized products and services are driving growth.
So we read the 2013 reports of 25 randomly selected companies from the global top 500 to look for indications of their focus on d-business. And, I suppose both surprisingly and unsurprisingly, we found very little about d-business at all. Here’s what we found
- 15 of the 25 companies have no mention of technology, IT or digitalization in their annual reports. They do have a standard mention of IT systems in the risk section — but this appears in every annual report.
- The 10 companies that do mention technology, digitalization, Internet of Things or big data in their annual report are in the financial services industry, communication service providers or outliers in their industry.
- When companies do mention digitalization, it’s in the chairman’s and/or CEO’s message. But it’s always toward the end of the message and ranked lower than all other areas of focus.
We were surprised because the shift to d-business appears to be across all industries, so we expected to see at least some mention of it in the majority of annual reports. On the flip side, we were not that surprised because we accept that annual reports tend to be conservative and backward-looking, typically not revealing information that is truly strategic.
So because annual reports are lagging indicators that don’t point to a future necessarily characterized by d-business, we decided to look at two Gartner surveys that focus more on emerging trends.
First, Mark Raskino and I both recently wrote about our annual CEO Survey, research that Mark leads. Mark found that CEOs are indeed more focused on technology but still lagging in their understanding of d-business. As Mark states, CEOs think e-business circa 2004, not d-business 2014. So at a high level, our CEO survey results suggest a continued need for CEOs to be more engaged in how digitalization can fundamentally change their business.
Secondly, in the Gartner benchmark business, we have performed over 250 digital benchmarks. One of the key questions we asked all participating organizations about is their ability to execute and their completeness of vision today and in 18 months in terms of moving to d-business. The data suggests a significant change is expected in the next 18 months that will far outstrip the existing capabilities of their organizations. It’s clear to us that organizations are overoptimistic about how fast they can achieve business change. They do not have the skills and change management culture to make such a leap. This is squarely an issue for CEOs, who need to step up to provide direction on d-business.
So Gartner research recommends that CEOs and boards do three things.
First, they need to be explicit about the business opportunity technology (not just information technology) presents. If they are serious, then investors need to know. If they want to capture the opportunities that exist, they need the public — their customers — to know. They need to make this explicit in their annual reports.
Secondly, they need to focus on developing the digital skills of their organization. They need to start today. Change management for d-business needs to happen now. Ensuring the right management skills exist in the organization is critical.
Lastly, pilot, and pilot now. D-business is a journey. Starting is important! And starting is not e-business of 2004. D-business of 2014 requires entirely new digital product development, new digital service approaches and reassessing where digital technology can integrate the entire value chain.
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by Peter Sondergaard | April 14, 2014 | 1 Comment
This week we published the 2014 Gartner CEO and Senior Executive Survey. Among the key findings is evidence of a bullish attitude by CEOs and senior executives toward technology-fueled business growth in 2014 and 2015. The same bullish attitude can’t be said for investors in tech-related stocks recently.
What really caught my eye in this year’s survey is that IT-related issues, including mentions of digital, are much more prominent as key priorities for CEOs. Gartner Fellow Mark Raskino and his research colleagues who authored the report found that 7 percent of CEOs rank IT as one of their top priorities. This might sound infinitesimally small (as context, the broad topic of “growth” was ranked as the top priority for 33 percent of CEOs), but this supports the broader trend that our research organization reports, in addition to my own observations working with CEOs around the world.
CEOs are undoubtedly taking a greater interest in applying technology more aggressively in their organizations. In the survey, nearly 50 percent of the IT-related priorities that CEOs gave specifically mentioned digital, online, social, cloud and mobile. Overall, CEOs referenced technologies frequently associated with client facing and revenue generating programs.
Drilling a little deeper into the survey, CEOs increasingly reported their growing investment in front-office technology-related capabilities that are used to help in sales and marketing. The research also noted strong interest among CEOs in basing business operations in the cloud and in using data-driven decision-making via business analytics, big data and data science. Process-centric themes, which tend to associate with back-office efficiency uses of technology, are much further down the list where we see items such as business process outsourcing, dynamic business process management and electronic service enablement.
What does this tell us?
CEOs are making the transition to a progressive mindset of investing in technology to drive growth and away from only thinking about generating internal cost reductions and efficiencies with IT.
This level of engagement by CEOs with technology has probably not been seen since the late 1990s. As Mark notes, technology has always been visible in the last decade of Gartner CEO surveys, but not so far to the foreground as it is this year.
As any successful business leader will tell you, a great attitude and mindset will only get you so far; there’s got to be substance to back it up. This is at the heart of the challenge for CEOs. Many leaders are lagging behind in their understanding of what digital business means.
This is where the CIO comes in. CIOs must take the lead in closing this huge gap in understanding by educating the CEO, their board, executives, senior and middle managers on the transformative value of digital. A decade of believing that IT was a commodity function has left many business leaders with a very polarized—and increasing outdated—view of what technology can do to support organizations goals.
As I noted in an earlier post, CEOs see digital as a team sport and this survey indicates that the CIO still has the highest visibility in terms of opportunity to lead the charge. When Gartner asked CEOs who they would allocate relative responsibility for leading digital innovation and change over the next two years, the CIO came out on top. However, many other roles are heavily involved, including chief digital officers (CDO), so CEOs clearly see digital as a collective operating committee endeavor.
One of the key conclusions that Mark and our colleagues in research make is that expecting the CIO to be the prime mover in digital is a fairly sudden and major change of expectation and emphasis. Digital is strongly associated with innovation. Two years ago, the Gartner 2012 CEO survey found CIOs were low on the list of perceived innovation leaders because they were tasked as IT cost managers and service quality assurers. This is a huge shift in expectation and, as we all know only too well, change is hard—especially when it happens to you.
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by Peter Sondergaard | March 3, 2014 | 2 Comments
I recently participated in an event in San Diego with more than 80 global CIOs who represent some of the largest companies on the planet. I enjoyed sharing the conclusions from our recent CIO Agenda Survey with this senior community and we had an interesting discussion on the latest trends in technology, evolving business demands and the major opportunities and challenges facing CIOs. Here’s a short video clip from our discussion to give you a flavor.
With so much experience in the room, I knew I was going to learn a lot from their questions and the debate that followed. One issue that surfaced again and again for this community was the need for agility in the business. And not just agility within IT, or for specific projects in IT, but agility within the entire organization.
Sitting here in Connecticut, I can almost hear the collective groan of the blogosphere at the very mention of the word ‘agility’, but let me explain what I heard from these global CIOs and why it resonated with me.
Much of the discussion that took place focused on the need for agility within the entire organization to drive performance improvement, rather than just one part of one team being agile while the modus operandi of the rest of the organization is business as usual. The concept of two-speed IT, or bimodal IT as we call it at Gartner, was debated at length by global CIOs because, in their experience, it’s impossible to isolate the impact of innovation on just certain parts of the organization. In their experience, it’s not sufficient for just one part of the organization to be agile because every part of the organization has to respond to the requirements, changes and demands that result from innovation! If innovation is really to drive meaningful improvement, the whole organization, both IT and the entire organization, must be able to respond quickly and work together at the same speed to implement change.
So, if two speed or bi-modal IT is where we are today and there’s a need for organization-wide agility, what role can the CEO and CIO play to drive this change?
Agile starts with the customer and a competitive situation requiring agility; an outside-in approach to agile. Being an agile organization means realizing what Gartner calls Business Moments. Being agile does not start with taking an IT development methodology and then making it an organizational approach. That would be an inside-out approach to agile. In the digital industrial economy CEOs need their organizations to respond rapidly. CEOs need to articulate what being agile means and hold their organizations accountable for the change that is required to meet this goal.
CEOs are constantly asking their global CIOs to be increasingly responsive and to get ever-more stuff done faster. Call it agile, call it organized chaos if you like, but this challenge is not new; how to work faster, smarter, better. What is new is that you can not ask one part of the organization to be agile, the IT organization, and then not have the rest of organization act in the same manner. This was what several of the CIOs noted. They know their IT organization can become agile.
CEOs know they will be challenged internally by their organization’s culture and performance management systems, but their biggest challenge is to ensure the entire organization, not just IT, acts in a consistently agile manner.
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by Peter Sondergaard | January 30, 2014 | Comments Off
Earlier this month, a team led by my colleagues Dave Aron and Graham Waller published the results of Gartner’s annual CIO Agenda survey.
Overall, the survey revealed that CIOs do not feel prepared for the next era of enterprise IT, something we at Gartner call digitalization – The Digital Industrial Economy. CIOs responded to say that they often feel overwhelmed by the prospect of building digital leadership while, at the same time, renovating the core of IT infrastructure and capability for the digital future. The survey found that 51 percent of CIOs are concerned that this change is coming faster than they can cope and 42 percent don’t feel that they have the talent needed to face this future.
The survey, which was conducted in the fourth quarter of 2013 and represents the views of more than 2,300 CIOs in 77 countries, is summarized in a report we published for clients that highlights the need for CIOs to respond to the dual goals of effectiveness and digitalization.
The themes that emerged from the survey reflect many of the trends we we discussed during our Symposia around the world in October and November 2013 and will explore at our upcoming Gartner Symposium/ITxpo in Dubai.
Dave and Graham point out that during the first era of enterprise IT, the focus was on how IT could help do new ‘stuff’ — automating operations to realize huge improvements in speed and scale, while also providing leaders within the business with information they never had before. The last decade represented the second era of enterprise IT, an era of industrialization of enterprise IT, making it more reliable, predictable, open and transparent. But, while this second era has delivered real benefits for organizations, rigorous budget control and little appetite for risk has left little to no room for innovation.
Technological and societal trends, such as the Nexus of Forces and the Internet of Things, are changing everything in the third era of enterprise IT. Digitalization is not only improving what businesses do with technology to make themselves faster, cheaper and more scalable, but fundamentally changing businesses with information and technology, changing the basis of competition and in some cases, creating new industries.
The report points out that CIOs are facing all the challenges they have for many years, plus a flood of digital opportunities and threats. Digitalization raises questions about strategy, leadership, structure, talent, financing and almost everything else as all industries in all geographies are undergoing digital disruption.
I was also interested to learn from the survey that CIOs reported that a quarter of IT spending will happen outside the IT budget in 2014. As the authors note, this is probably a conservative estimate because this only accounts for the spending CIOs know about; the reality may be significantly higher.
Finally, Dave and Graham stated that there is an inherent tension between doing IT right and doing IT fast, doing IT safely and doing IT innovatively. Whereas the second era of enterprise IT has been all about planning and doing IT right, CIOs now need to deal with speed, innovation and uncertainty. This requires a concept we call bimodal capability, which means operating two modes of enterprise IT at the same time; conventional, or “safe and steady” IT, and a faster, more agile nonlinear mode.
In a future blog post, I’m going to explore what CEOs should know introducing a bimodal capability into their organization, and how to engage their CIOs in the shift to this strategic capability. Is this a journey you are already on? Have you started to address this fundamental challenge? I’d like to learn more about your experience for my next post.
If you are client, a detailed analysis is available in the report “Taming the Digital Dragon: The 2014 CIO Agenda.”
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by Peter Sondergaard | December 28, 2013 | 19 Comments
Our behavior online, and even offline, as the Internet of Things becomes a reality, generates huge volumes of data. Huge! But whose data is it exactly? You might produce it, but who owns it? Who profits from it? Who currently stands the most to gain from it? I’ll give you a clue — it’s not you!
It’s true that we’ve started to unlock some of the potential value that is contained within big data. It’s also true that we, the consumers, benefit from getting better recommendations, discounts on other products we might like and deals customized to our preferences.
But this is nothing, absolutely nothing, compared to the value of your data to an enterprise today or in the near future.
Right now, in this first wave of what we at Gartner call the new digital industrial economy, we are giving this hugely valuable data away for very little in return. Discounts, offers, recommendations, deals.
But all this could change.
In the second wave of the new digital industrial economy, consumers will shift from being largely ignorant of their data’s value to being highly intelligent, protective and selective about how they collect and manage it.
In this second wave, consumers will be enabled and empowered to own and thereby monetize their own data, effectively wrestling back the control and driving up the value equation for themselves.
I know this represents a polar shift from where we are today — from companies aggregating and owning data to consumers owning and managing their own data and most importantly monetizing their data. And as is the case in most major changes, the reality will probably lie somewhere in the middle.
Regardless, the impact on the technology industry will be profound. It probably won’t be another Google or Amazon or Microsoft that comes along to challenge established leadership positions. It won’t be a bigger, better, fresher, newer version of these successful companies. Leaders in the new digital industrial economy will most likely be an organization, or even more likely somebody, completely different. When I say somebody, I actually mean us. That’s you and me, multiplied by a couple of billion individuals.
Consumers will no longer be satisfied with trading their highly complex personal data for simple discounts. They will find ways to wrestle back ownership, and thereby control, of their own data. Their personal big data. They will have software that enables them to monetize their data.
The result? Consumers will have the power to sell, exchange or barter their data in return for products and services of equal worth. With this change, we will see the start of the next wave in the new digital industrial economy; A wave of change that will means everyone becomes a technology company.
We are conducting research into this field today to find answers to some fundamental questions. What or who will act as a catalyst for this change? How will consumers manage their data? How will the market or exchange operate to provide a platform for information to flow between the consumer and the provider? What new opportunities will exist for consumers, brokers, technology providers and industries of all types? And how will this shift impact established industries, providers and consumer behavior?
We look forward to this conversation continuing for some time to come, and I’m interested in your point of view. Do you already see demand for this shift? Do you see early examples of the transition of ownership taking place? Or do you think data will continue to be owned by the enterprise and that the current status-quo is too powerful to be threatened? I look forward to your comments.
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by Peter Sondergaard | November 26, 2013 | 1 Comment
New research recently published by my colleague Ken McGee examines how CEOs are typically hiring chief digital officers (CDOs). It’s hard to know what’s going on under the cover with internal direct hires and internal referrals, but he learned a lot by talking to senior recruiters about their experience working with clients.
Ken’s research is interesting on several different levels, but one aspect in particular really struck me. It is that many of the search requirements provided by clients lacked the clarity and certainty about digital business and objectives for a CDO that usually accompanies the specificity for virtually every other C-level executive search.
You probably just read that sentence twice. That’s right; CEOs don’t know why they want a CDO or what the CDO will do.
Hold on a minute there, CEO! More haste, less speed is needed here.
We believe that executive uncertainty about digital business and what they expect to gain from a CDO will likely result in valuable time being lost to any number of flawed CDO search false starts and failed outcomes. This will only aid competitors who already have a better understanding about their digital business strategy and the value that a capable and effective CDO can deliver to their enterprise.
So what’s a CEO to do? Put simply, we recommend putting the horse before the cart, not the other way around.
First and foremost, CEOs need to determine whether their enterprise should create a digital business strategy. This should be a key discussion within an existing enterprise-wide planning process that involves the entire C-suite or, alternatively, a separate planning program to kick-start the process of discovery thoughtfully. The outcome should be a definitive, declarative and board-ready position on what digital business means to their enterprise.
CIOs have a critically important role to play in this process. They should offer a briefing on digitalization that is specifically modified for each c-level executive and outline the potential implications that digital business could have on each senior executive’s area of responsibility. This is the foundation to building a clear understanding of the business need and the potential business value. This will, in turn, provide the foundation for a CDO search, based on definitive business requirements.
Until a business need and broad objectives are agreed, chief talent officers should strongly advise CEOs against commissioning a search for a CDO in advance of clearly defining the role.
After all, how can you find what you need when you don’t know what you’re looking for?
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by Peter Sondergaard | November 6, 2013 | 2 Comments
The new digital industrial economy will have a massive impact on major technology vendors. This in turn will create both exciting new opportunities and intense challenges for CIOs.
Most vendors will need to radically transform their offerings to remain competitive and relevant to their customers, many of whom will also digitalize their offerings in order to succeed. The pace of this change will be at the speed of digital and, as a result, we predict that many of the vendors that are on top today will be fighting for their lives tomorrow.
Why? Let’s take a step back so that we can see the future a little more clearly.
The top technology companies have reigned over the industry for long periods — a decade, sometimes even longer. But what they sold you in the past, and what they are selling you today, is not what you will need for the digital future.
On top of this, vendor channel strategy, sales force and partner ecosystems are being challenged by different competitors, new buying centers and changed customer business models. To add fuel to the fire, digitalization is creating accelerated technology-driven startup environments around the globe.
We know that most suppliers don’t dominate from one generation of IT to the next. Many of the vendors that are on top today, like Cisco, Oracle and Microsoft, will need to change radically if they are to retain their market leadership in the new digital industrial economy.
CIOs can see this coming. They tell us they expect different vendors to lead the next wave of innovation. Our latest CIO survey, the results of which are currently being analyzed for publication in early 2014, show that two-thirds of CIOs expect to change their primary suppliers by 2017.
Let me say that again: Two-thirds of CIOs expect to change their primary suppliers by 2017.
But there is some good news for vendors. CIOs will be spending more, not less, on technology in the foreseeable future. The challenge for vendors will be to offer products and services that meet customers’ new requirements, not fighting for a shrinking slice of a withering pie. For the year ahead, Gartner reports that the IT market is growing at a modest 3.2% annual growth rate. In two years, the combined IT and telecom market will hit nearly $4 trillion, or roughly 5% of World GDP.
Looking more deeply at IT spending, a couple of things that are important for CIOs and vendors alike stand out.
First, consumer technology spending is outstripping business and government technology spending. Annual spending on consumer devices will be four times that of business and government.
Mobile smart devices have taken over the technology world. By 2017, new device categories such as mobile phones, tablets and ultramobile PCs will represent over 80% of device spending. In fact, by 2017, nearly half of first-time computer purchases will be a tablet. To put this into context, this category barely mattered a decade ago.
So mobile will be your destination platform for all applications.
Second, the way CIOs need to look at data centers is also shifting. Right now the data center market capacity is about 80% private, meaning the servers and infrastructure in your data centers. That will shrink to 65% in just four years.
We are firmly in the era of cloud operations and the approach for private data centers has changed. About 20% of spending will be on hyperscale systems, using the model that the global cloud leaders like Google and Amazon pioneered, delivering massive scale.
Change is inevitable. We believe that accelerated vendor leadership changes are on the near-term horizon. These new leaders will drive a fundamental shift in the strategy of their organizations. As a result, CIOs will need to prepare — at least half of the strategic vendor relationships they have today will be with previously unimaginable new partners in the future.
We’ll talk more about these issues at Gartner Symposium/ITxpo in Barcelona, Spain next week. Will we see you there?
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by Peter Sondergaard | October 31, 2013 | 2 Comments
The digital world is upon us. Every budget is an IT budget. Every company is a technology company. Every business leader is becoming a digital leader. Every person is becoming a technology company.
Welcome to the Digital Industrial Economy.
If you’ve already attended Gartner Symposium/ITxpo in South Africa, Japan, US, India or Australia this week, you’ll recognize these opening remarks from our analyst keynote. And judging by the literally hundreds of CIOs I have spoke to over the past few weeks at these events, we’ve captured the attention, mood, hopes and, quite frankly, many of the fears of our attendees.
One of the questions we address directly in our opening keynote is about “digital” itself. Basically, what is it?
First, it’s not digitization. That is about zeros and ones. Digitalization is about something much, much more. Something altogether bigger and fundamentally more important. It’s about the transformation of your business.
Digital business applies unprecedented combinations of new technologies to generate revenue and value. It starts with digital assets and capabilities.
For business, it means digital products, services and customer experiences conducted through digital channels from the front office all the way through the value chain. For governments, it means digital services to constituents, more transparency and higher mission effectiveness
Digitalization exposes every part of your business and its operations to the Nexus of Forces (where cloud, mobile, information and social technologies meet) and the Internet of Everything. It is how you reach customers and constituents, how you run your physical plant and how you generate revenues or deliver services.
No matter what business or service you deliver today, digitalization is changing it. The changes we see in media and digital marketing are just the beginning. If you work in agriculture, mining or manufacturing, digitalization means a new opportunity for you as well. If you deliver public services, digitalization allows you to better engage with your constituents where they are in the moment.
And the way your business runs, your internal operations, are changing too as digitalization is becoming pervasive inside organizations, shortening time cycles. For example, to a chief marketing officer, what happens with a customer in the moment can make all the difference. S/he can commission a successful mobile app-driven campaign that sees payback in a matter of weeks. That’s the time it takes a typical IT organization to just gather requirements.
We are seeing the cost for the basic hardware building blocks of the Digital Industrial Economy, such as sensors, radios, and microprocessors are plummeting. In 2009, 0.9B sensors and 1.6B personal devices — so roughly 2.5B “things” — were connected. But by 2020, that will grow to become 30B “things”. In fact, by 2020 all products costing more than $100 should have sensors embedded, even if you don’t know what to use them for.
Digitalization will change the way we all think about technology and, after talking to CIOs at Gartner Symposium/ITxpo across four continents in the last few weeks, it will fundamentally change the way we need to lead our organizations to be successful in this new digital world.
So if you haven’t attended Gartner Symposium/ITxpo in order to figure out what all this means for you and your organization, don’t worry. There’s still time to register for Sao Paulo next week and Barcelona the week after!
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